self employed accounts

lois86

hi, im currently trying to get a mortgage. im self employed and have 2 years accounts, 3 years in april however ive had an offer accepted on a bargain of a property. the last time i had a mortgage i self certed.

property price - £65000

wanting to borrow £58000

2011-2012 income on Sa302 - £8500
2012-2013 infcome on Sa302 - £18000

this years accounts are due in april and ive earned over 18k already but lenders wont entertain a projection even 1 month away from the end of the tax year.

will i be able to get the mortgage i need of £58k on my 2 years accounts? i have perfect credit history, cleared my mortgage when i sold my last house in july, i have 0 credit commitments as i dont have a credit card and my loan is paid off in full. ive never missed a single payment on anything. I have 20k savings so wanted to put 7k down as a deposit leaving me cash to renovate the property.
the repayments will only be around £250 per month which is alot less than the £450 i would be paying in rent. it seems ridiculous that lenders will go on income i had over 2 years ago which doesnt reflect my current wage at all. an employee only needs to show 3 months payslips!! Seems so difficult to get a mortgage self employed

laura_louise

I just got my mortgage offer and i believe they used an average of the past two years income. I'm sure it's different depending on your lender though!

lois86

Thats what im worried about. the 2011 figure of £8500 no way reflects my earnings for the last 2 years. the property im trying to buy is a steal at 65k and with work done on it will easily be worth 95k.

Mattygroves2

Your 2013/14 tax return should have been filed by now so you should have another year of figures.

laura_louise

I've seen someone mention a lender on here which only requires one year of accounts... i don't know who it is though. I wonder if that may be an option? In any case, your average of 2 years is 13250 and you want to borrow around 4.5x that which from what i've seen is roughly the limit (of course got to factor in affordability issues too...) so you might be OK. Definitely go and speak to a broker who can advise you.

Good luck..

lois86

sorry the above figures should read...............

2012-2013 £8500
2013-2014 £18000

this years are due in april and im already above 18k

affordability wise i have no other credit commitments.

this property would set me up for the future, i can increase its value straight away and the mortgate payments are cheap.
lenders seem so shortsighted towards the self employed, looking at my earnings from over 2 years ago in no way reflects now yet someone employed with 6 months payslips who could of been on the dole for the previous 10 years would find it a walk in the park. :mad:

GMS

Speak to a broker to see if it is possible.

Some lenders will work off the latest years figure.